UK to explore options to stay competitive, says Finance minister Philip Hammond

The UK Finance Minister Philip Hammond, speaking at the World Economic Forum in Davos, Switzerland, said that in the absence of a "comprehensive trading relationship" after Brexit, UK could explore options to stay competitive.

Hammond said that Britain wants to explore ways with the EU to ensure that decades of close ties are not broken, saying with goodwill, anything was possible. However, he warned that Britain would be forced to find different ways to remain competitive if there was no "comprehensive trading relationship".

He said that while the government did not want to leave the economic mainstream and trigger a race to the bottom on tax, the decision was "not entirely in our gift". Hammond said "Britain wanted to explore options to find ways businesses - including the financial industry, which fears losing the right to sell their services in the bloc - can trade freely".

Hammond said he is confident the pound will find an “appropriate level” as Britain progresses with its plan to exit the European Union. Hammond said he saw no case right now for using some of the room he reserved last year for the government to borrow more, ahead of his annual budget on March 8.